The headline: volumes are down, but not evenly
Company insolvencies across England and Wales totalled 9,661 in the first five months of 2026, against 10,310 over the same period in 2025, a fall of 6.3%. Taken on its own, that reads as an easing market. The detail underneath it tells a more interesting story, and it's the kind of detail that only shows up once you look past the headline figure that the Insolvency Service publishes each quarter.
One in every 196 companies on the Companies House effective register entered insolvency in the 12 months to 31 May 2026, a rate of 50.9 per 10,000, down from 53.0 a year earlier. May 2026 alone saw 1,868 registered company insolvencies, 10% lower than April and 16% lower than the same month in 2025.
The split that matters: director-led vs creditor-forced
The overall fall masks a shift that's directly relevant to why Director Options exists. Creditors' Voluntary Liquidations, the director-initiated route where a company closes on its own terms before creditors force the issue, are down modestly year on year. Compulsory liquidations, which are creditor-forced and are recorded as formal notices in The Gazette, climbed from 259 in January to 371 in April 2026, the highest single month outside a recession-level peak since September 2014, before easing back in May.
Read those two numbers together and they say something worth sitting with: fewer directors chose to act early, and more had the decision made for them by HMRC or by trade creditors running out of patience. Closing that particular gap, between the directors who see it coming and the ones who don't get a say, is precisely what we built this service to help with.
Where it's concentrated: sector
Six sectors account for roughly 73% of Creditors' Voluntary Liquidation volume across England and Wales:
- Construction, around 17%. Contractors, groundworkers and M&E firms carrying late payment, CIS and VAT arrears.
- Wholesale and retail, around 15%. Independent retailers and motor trade businesses under lease and business rates pressure.
- Accommodation and food services, around 14%. Restaurants, pubs and hotels managing rent arrears and seasonal cash flow against VAT and PAYE demands.
- Administrative and support services, around 10%. Cleaning, security and facilities firms with thin margins and heavy PAYE exposure.
- Professional, scientific and technical, around 9%. Accountancy, consultancy and IT firms, often carrying an overdrawn director's loan position alongside everything else.
- Manufacturing, around 8%. Light and medium manufacturers absorbing supply chain debt and rising energy costs.
Construction has been the largest single sector by volume every year since 2015, and it remains so today.
Where it's concentrated: geography
Insolvency rates aren't spread evenly across the UK. The North West and Yorkshire and the Humber currently show the highest concentration of company insolvencies relative to the number of companies registered in each region, both running above the England and Wales average. That regional pattern, combined with the sector data above, shapes a lot of where and how we focus our own outreach.
What this means if you're a director reading this
None of this data tells any individual director what to do. Every company's situation is different, and averages don't make decisions for anyone. But the pattern is consistent enough to be worth stating plainly: the directors who come out of a difficult period with the most options tend to be the ones who started the conversation before a creditor forced it. The data shows that gap widening, not closing, and it's a useful thing to know whether or not your own company is anywhere near this territory yet. For the tax side of the same picture, our piece on the director's loan account deadline covers the other timing pressure a lot of directors are juggling alongside creditor pressure.
Want to know where your company sits against this picture?
Director Options reviews your specific circumstances, confidentially and without obligation, and connects you with the right specialist firms.
Discuss Your Options →Sources
- The Insolvency Service, Company Insolvency Statistics, GOV.UK
- The Gazette, Insolvency notices, published under the Open Government Licence v3.0
- Companies House, Companies House register data, GOV.UK
Figures are correct as at the time of writing and are subject to revision in later official releases. This article is provided for general information only and does not constitute advice.